California: Application of SB 863 Changes to Home Health Care Services

California: Application of SB 863 Changes to Home Health Care Services

The legal community posed many questions after SB 863 was enacted. One of the more pressing issues centered around how the WCAB would apply the new limitations governing reimbursement for home health care services.

> Would the limitations only apply to services performed after 1/1/2013?

> Would the limitations only apply to services regarding a date of injury after 1/1/2013?

> Or, would the limitations apply to all services, for all dates of injuries, regardless of when the services were performed?

> And, once the services are provided and reimbursement is requested, what is the applicant’s burden of proof under the new statute?

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In the noteworthy panel decision of Mulford v. El Toro RV, 2013 Cal. Wrk. Comp. P.D. LEXIS 219 (, 2013 Cal. Wrk. Comp. P.D. LEXIS 219 (Lexis Advance), the WCAB addressed all of these issues. However, as set forth below, the WCAB commissioners differed in their interpretation of how the new law should be applied to the facts of this particular case.

I. Effective Date of Home Health Care Services Limitation:

It is not uncommon, especially in the case of catastrophic injuries, for the spouse of an injured worker to serve as the home health care provider. This is often a preferable option, both on an economic level, as well as a rehabilitative level. This is especially true when the only two choices are in home health care and an assisted living facility.

In the past, it was the usual practice to wait until after the underlying case had been resolved before negotiating reimbursement for home health care services. However, as home health care costs escalated, insurance companies became increasingly concerned that they were not able to forecast a risk assessment for these costs. SB 863 sought to address this concern by amending LC § 4600(h) to provide limitations on this medical treatment benefit. One of those limitations is that employers are not liable for home health care services provided “more than 14 days prior to the date of the employer’s receipt of the physician’s prescription.”

At the time SB 863 was enacted, there were a multitude of workers’ compensation cases throughout the state of California where unpaid fees for home health care services reached thousands of dollars, and in some cases hundreds of thousands of dollars.

Did the change in the law mean that spouses (or other individuals) that had provided these services would have to forfeit reimbursement if the employer had never been served with a physician’s prescription?

The answer according to Mulford, supra, appears to be yes, although it is only a “noteworthy panel decision” reported by LexisNexis and therefore persuasive, but not precedent [see Griffith v. WCAB (1989) 209 Cal. App. 3d 1260, 1264, fn. 2, 54 Cal. Comp. Cases 145; Gee v. Workers’ Comp. Appeals Bd. (2002) 96 Cal. App. 4th 1418, 1425 fn. 6, 67 Cal. Comp. Cases 236; Guitron v. Santa Fe Extruders (2011) 76 Cal. Comp. Cases 228, fn. 7 (Appeals Board En Banc Opinion)].

In Mulford, supra, the three WCAB commissioners unanimously concurred that LC § 4600(h) “applies to all pending cases prospectively from the date the statute became effective regardless of the date of injury.” In so holding, the WCAB refers to “the 2012 notes following section 3700.1 which read, in relevant part, ‘This act shall apply to all pending matters, regardless of the date of injury, unless otherwise specified in this act.’ (Stats 2012, ch. 363, § 84.)”

Since LC § 4600(h) does not specify an effective date, legislative policy mandates that it apply prospectively to all cases, regardless of date of injury.

In the noteworthy panel decision of Neri-Hernandez v. Workforce Staffing, 2013 Cal. Wrk. Comp. P.D. LEXIS 325 (, 2013 Cal. Wrk. Comp. P.D. LEXIS 325 (Lexis Advance), the WCAB reached a similar conclusion regarding applicability of the new limitations on reimbursement of home health care services. However, inexplicably and in an extremely rare move, on August 16, 2013, four days after issuing their decision, the WCAB granted reconsideration of their own decision (on their own motion) to further study the issues involved in the case.  

II. Applicant Must Produce a Physician’s Prescription:

Although all of the commissioners agreed that LC § 4600(h) applied to all dates of injury in the noteworthy panel decision of Mulford, supra, they differed as to how the limitations should be applied to the facts of the case.

Clifford Mulford worked as a service writer for employer, El Toro RV. (A service writer usually refers to the person who writes the repair orders for vehicles that need to be serviced.) On March 8, 2011, Mr. Mulford fell from a ladder at work and suffered a catastrophic brain injury and was deemed 100% permanently disabled. After spending several months in the hospital, he was released to home care, but was “experiencing residual left side weakness, decreased memory, fatigue and seizures.”

Initially, defendant authorized applicant’s wife to serve as his home health care provider, and reimbursed her for 12 weeks of care, (six hours a day, five days a week.) On October 23, 2013, once it became evident that SB 863 was going to limit reimbursement for home health care services, defendant stopped reimbursement payments to Mrs. Mulford.

Applicant was then evaluated by Dr. Adams, his treating physician, a neurologist. In his prescription of January 14, 2013, Dr. Adams wrote, “’Home health or or [sic.] case manager RN to eval for ongoing home health assistance.’ (January 14, 2013 Prescription Note, Exh. YY, p. 1.)”

Commissioners Lowe and Moresi agreed with the trial Judge (WCJ) that this January 14, 2013 “prescription” did not rise to the level of what was required per LC § 4600(h), since “it prescribes an evaluation to determine whether home health care services should be provided,” and not the actual home health care services.

Commissioner Sweeney in her dissenting opinion respectfully disagreed with the majority’s opinion. She felt the record on this issue should be developed pursuant to LC §§ 5701 and 5906 and the WCAB en banc decision of McDuffie v. LA County Metropolitan Transit Authority (2001) 67 Cal Comp Cases 138.

To support her position, she referred to the report written by applicant’s treating physician, Dr. Adams, “stating that applicant ‘requires 7-day support system.’ (December 5, 2012 Primary Treating Physician Report, Exh. YY, p. 2.)” She also considered the fact that defendant had already paid for 12 weeks of home health care.

In addition, Commissioner Sweeney wrote, “[a]t the July 10, 2012 expedited hearing, defendant agreed to pay for an occupational nurse to provide a home health care study for applicant, who remains 100% permanently disabled. The nurse recommended that applicant be provided with home health care six hours per day, five days per week.”

For all of the above reasons, Commissioner Sweeney felt that the matter should be returned to the trial level to allow the treating physician, Dr. Adams, to “clarify” his reports of December 5, 2012 and his prescription of January 14, 2013.

PRACTICE TIP:  Query as to whether this case may have had a different result if there had been a supplemental report from Dr. Adams, the treating physician, clarifying that he intended his December 5, 2012 report to constitute a prescription for home health care services. Parties should be mindful to develop the record on issues such as this, with a supplemental report or deposition of the physician, prior to the Mandatory Settlement Conference, in order to ensure that it be considered by the trier of fact. .

III. Applicant’s Burden of Proof:

In addition to producing a prescription from the physician requesting home health care services, applicant must also establish the following:

> The employer received the prescription. LC § 4600(h):

> The home health care services are reasonable and necessary to cure or relieve from the effects of the injury. LC § 4600(h):

> If provided by a household member, the services were not “regularly performed in the same manner and to the same degree prior to the date of injury.” LC § 5307.8

In preparing for a hearing on the home health care issue, parties should be cognizant of the above stated requirements.

In addition, parties should be aware of a new section, LC § 4603(b)(1) created by SB 863, which provides in relevant part: “Any provider of …home health care services, shall submit its request for payment with an itemization of services provided and the charge for each service, a copy of all reports showing the services performed, the prescription or referral from the primary treating physician if the services were performed by a person other than the primary treating physician, and any evidence of authorization for the services that may have been received.” (Emphasis added.)

PRACTICE TIP: Perhaps the official medical fee schedule (OMFS) for home health care services (mandated by new LC § 5307.8) may obviate the need to provide extensive detail with regard to “itemization of services provided,” but until that is made clear by case law, parties should comply with this mandate.

IV. Conclusion

Although not yet definitive, it appears that the WCAB intends to apply the new home health care limitations to all pending cases, regardless of date of injury. What is not so clear is the type of evidence required to sustain applicant’s burden of proof on this issue. Until that is clarified through future case law, parties should be mindful to ensure they have met all of the statutory requirements as set forth above, before they meet with the Judge at the Mandatory Settlement Conference.

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